Jim is approached by a friend who is already a distributor for Company A to become a distributor as well. Jim’s friend tells him it’s an “amazing business opportunity” and that he’s only telling Jim about this because he’s the kind of entrepreneurial guy who could succeed with it. The friend shares how other distributors have been able to make enough money selling shakes that they’ve paid off student debt and bought a second car. He says very little about the product itself except that it’s fantastic and practically sells itself.
Network marketing, also known as Multi-Level Marketing (MLM), is a business model where independent contractors buy into a company and earn a commission on the products they sell. The profession appeals to many people because they can be their own boss, set their own hours, and work towards their own success. It is a big commitment, but network marketing can be a very lucrative career.

Herrera and her patients aren't the only ones doling out rave reviews for CBD oil, which can be found online and in cannabis dispensaries, as well as in some grocery stores and even as an optional add-in alongside protein powder at your local juice chain. The oil has been riding the coattails of the growing legal cannabis industry, with one industry expert, Matt Karnes, telling Forbes in 2016 that he expected CBD products to become an almost $3 billion market by 2021.


Of these second-wave MLMs masquerading as women’s empowerment, LuLaRoe is queen. More than 80,000 women have paid around $5,000 for several boxes of low-cost clothing and worked as much as 80-hour weeks to outfit hundreds of thousands of suburban women in multicolored polyester. But according to a report that studied the business models of 350 MLMs, published on the Federal Trade Commission’s website, 99% of people who join multilevel-marketing companies lose money. Depending on how you look at it, it’s either a brilliant business model or a predatory practice—or a little bit of both.
If you don’t understand something, ask for more information until it is absolutely clear to you. Your sponsor and other distributors should be willing to answer your questions. Remember that your sponsor (and others above your sponsor's level) will make money if you join the program. So take your time, and resist pressure to join. Be aware of shills — fake references paid by the company or distributor to pretend they were successful earning money through the plan.
Multi-level marketing (MLM) is known by a variety of names: network marketing, referral marketing—and more pejoratively (and/or when done unethically), pyramid marketing. In this structure, marketing and sales reps not only receive compensation for their own sales, but also receive a percentage of the sales generated by other salespeople they recruit (commonly known as one’s “downline”). (See also Referral Marketing)
Shortly after, Stern began to pull in anywhere from $18,000 to $24,000 a month in sales. She was working 80-hour weeks with seven women selling underneath her. “The moment I woke up, I was taking pictures and answering questions,” she says. “My husband had to do the food shopping. My daughter has dance one day a week. While she was dancing, all the other moms would talk, but my face was always in my phone. I was uploading albums, or I was part of a multi-consultant sale.”
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